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Analysis: How'd The 3DS Do At $250?
Analysis: How'd The 3DS Do At $250?
August 15, 2011 | By Matt Matthews

August 15, 2011 | By Matt Matthews
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More: Console/PC, Business/Marketing



[As part of his monthly analysis of NPD results, Gamasutra analyst Matt Matthews examines how the Nintendo 3DS performed at retail through its last full month at its original $250 price point.]

There were only three days left in the NPD Group reporting period when Nintendo announced it would cut the price of the Nintendo 3DS handheld from $250 to $170, effective on 12 August 2011. Consequently, the announcement's effect on July sales was probably negligible and we can look at July sales as entirely the result of the handheld's launch price and software.

According to official NPD Group data provided to us, the average selling price (ASP) of the 3DS during the month of July 2011 was $248, confirming that the system was not seeing much in the way of retail discounting through the end of July. Moreover, based on that ASP and the other ASPs for other hardware platforms, comments made by Anita Frazier, and the figures revealed by Microsoft and Nintendo in their respective press releases, we estimate that the Nintendo 3DS sold around 90,000 – 95,000 units during the month.

That would mark a 20% decline from June 2011 results, based on average weekly sales, and a 7% decline from the rate in May. The figure below shows the average weekly sales rates for the 3DS since launch.

As a result of these figures, the Nintendo 3DS had still not sold a million units in the U.S. by the time Nintendo announced the price cut. (Our estimate puts it somewhere between 915,000 and 940,000 on 30 July 2011.)

For comparison, during the first five months of its life, Sony's PlayStation Portable (PSP) sold just over 1.7 million units.

The 3DS is now priced the same as the Nintendo DSi XL and only $20 more than the Nintendo DSi, which should make it far more attractive to consumers considering the other Nintendo handhelds. However, price alone won't overcome the lack of 3DS software, and Nintendo knows that. Since the price cut, the company has repeatedly mentioned that a Super Mario 3D Land and Mario Kart 7, both for the 3D handheld, will be available later this year.



We will see in August's figures, and perhaps more clearly in September's data, just how important that price drop will be, since Nintendo's key new software still won't have arrived.

During that period consumers will have a choice of four Nintendo handhelds: the Nintendo DS Lite, the DSi, the DSi XL, and the 3DS. The DS Lite was priced at $100 starting in June 2011, and has been increasingly difficult to find at retailers and online. However, in July the average price of across the three DS models (i.e. not including the 3DS) was $130, according to NPD Group estimates, and that means that a significant number, about 30-40%, of these consumers are opting for the cheapest model.

That suggests to us that the surge in sales the Nintendo DS line saw during June and July, from 50,000 units per week in May to over 75,000 units per week, was largely driven by the Nintendo DS Lite price drop. If the DS Lite disappears (and we expect it won't be available much longer) then so will those consumers, and the price of getting a Nintendo handheld will have moved up to $150.

As a consequence, Nintendo's current pricing will encourage some potential Nintendo DSi and DSi XL consumers to select the 3DS instead, but that population is limited. When the September numbers arrive in mid-October, we may well be talking about 150,000 – 180,000 units per month for the 3DS. An improvement, surely, but Nintendo certainly wants stronger figures.

The market for the Wii is also showing a sharp sensitivity to price, as the effects of the price cut to $150 in mid-May are already appearing to dissipate. Sales shot up to nearly 60,000 units per week during May, but fell back slightly in June and then returned to nearly the same level seen in April, near 45,000 units per week. (See the figure just below.)



Two months ago we suggested that Wii sales could follow precisely this kind of trajectory, citing the recent PSP price drop as a precedent. Should Wii sales erode further (below, say, 150,000 units per month) it will be interesting to see how, or even if, Nintendo chooses to respond. It is conceivable that consumers waiting for the system be priced less than $200 bought it during one of the many retailer specials (e.g. with a gift card), bought it used, or adopted another system. As a result, the next large group of consumers to which Nintendo could appeal are waiting for a system below $150.


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Comments


Jonathan Escobedo
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If Nintendo had made Pokemon Black and White 3DS launch titles, or even had Ocarina of Time as a launch title, we wouldn't be having this discussion on price.

Michael Wenk
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I can definitely see myself buying it now. Well, if there's compelling software, and I don't think a mario handheld or mario kart will do it for me this time. But now its not out of reach. Still, why would I pay 40$ for a game when I can buy something for 3-5$ on the iOS App Store?

Eric Feliu
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You always pay more for better quality. I find it silly to compare a $3-5 phone game to a $40 3DS game. I have played a few games on my Android phone and I have found the controls lacking and the games are very simplistic. I generally only play games once and a while on the phone and mostly to kill time while I am mobile (usually less than 15 minutes). On a 3DS games have much better controls and the experience is generally much deeper. I tend to play 3DS games when I know I have a significant amount of time to kill and spend at least 30 minutes playing. So I would say games for dedicated handhelds like the 3DS are worth the extra price because they deliver superior gaming experiences over most phone based games. I am sure there are a few really deep phone games, but the controls always seem to get in the way of my enjoyment on all phone based games. You really need a dedicated game system to play for extended periods of time in my opinion.

Eric Geer
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I play my 3DS every day on the train to and from work---I usually get in about a half hour between waiting and riding---my favorite thing about all DSs is that you can shut the lid and hours later open it back up and you just continue where you last were--its a wonderfully helpful feature on the run.

Jakub Majewski
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I'm sorry, but your comments show that you simply haven't got much idea what's out there for the iPhone and Android.



It's true that the overwhelming majority of the mobile phone games are simplistic and lacking - one thing Nintendo's policies have always prevented was a flood of clone games, where you'd have five thousand different developers making almost-the-same-game in the hope of cashing in on someone else's success.



However, when iPhone/Android games are good, they are really damn good - and not in any way inferior to any dedicated mobile platform, whether it be the 3DS or PSP. The controls are different, true, but not worse - last year, I worked as a producer on converting The Bitmap Brothers' Speedball II from the Amiga to the iPhone. We implemented two different control systems - a "virtual d-pad" and tilt-based controls. Neither system was simplistic in any way (we did not have to drop any functionality compared to the original game), but it was the tilt-based controls that really made the game for me. Instead of clunky d-pads and whatever else you have on the 3DS, you simply use the entire device as a gamepad - fantastic.



(that having been said, I don't doubt that most developers choose the easier option, and simply smack a d-pad on the screen. But... well, like I said above - undeniably the 3DS' biggest strength is Nintendo's continuing commitment to keeping the flood of crap off the console)

Eric Feliu
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Well I disagree with you that I don't know what's out there on he Android. I try just about every game I see on the Android and they all pretty much have lacking controls in my opinion. Give me precision stylus or control pad control of the DS over any phone game. Maybe you have not played enough dedicated handheld games?

Jakub Majewski
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Do I need to play dedicated handheld games to know that I have played games on the iPhone that were tremendous fun? :)



As for the Android - I'll admit, I'm mainly familiar with the iPhone, I really have no idea what's out there for the Android. Maybe it is, as you suggest, a desert, devoid of any noteworthy titles. But even then, there are such titles on the iPhone, so you still shouldn't claim that this is a phone thing in general. The mobile phone in general, and the iPhone in particular is a great platform for games, no inferior to any handheld console, and far superior in many regards - even if most of the available games do not even attempt to show this.


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